NEWS

ANADARKO TO ACQUIRE KERR-MCGEE CORPORATION

& WESTERN GAS RESOURCES, INC.
IN SEPARATE TRANSACTIONS TOTALING $23.3 BILLION

DEALS CREATE LEADING POSITIONS IN TWO OF NORTH AMERICAS

MOST PROLIFIC PRODUCING REGIONS
PORTFOLIO TO BE OPTIMIZED THROUGH ASSET SALES

HOUSTON, June 23, 2006 Anadarko Petroleum Corporation (NYSE: APC) today announced it
has agreed to acquire Kerr-McGee Corporation (NYSE: KMG) and Western Gas Resources, Inc.
(NYSE: WGR) in separate all-cash transactions totaling $21.1 billion, plus the assumption of debt
estimated at $2.2 billion.
We are creating a combined company with industry-leading positions in the deepwater Gulf
of Mexico and the Rockies, two of the fastest-growing oil and natural gas producing regions in North
America, Anadarko Chairman, President and CEO Jim Hackett said. The core assets being
acquired strongly complement Anadarkos existing properties, providing the scale and focus needed
to deliver more robust, predictable and efficient growth. Kerr-McGees outstanding deepwater
holdings and skill sets will elevate Anadarko into the top echelon of deepwater operators. Similarly,
Kerr-McGees long-lived natural gas resource plays in Colorado and Utah, along with Western Gas
Resources in Wyoming, will combine with Anadarkos assets to make us one of the largest
producers in several of the most prolific basins in the Rockies. Together, these acquisitions create a
more focused portfolio, which will enhance our ability to deliver very competitive growth rates and
returns.
Hackett emphasized that the transactions are consistent with Anadarkos strategy, which is
built around the companys core competencies in unconventional resource development and high-
impact exploration.
Two years ago, we unveiled a strategy that included a solid North American foundation of
onshore resource plays, a growing deepwater Gulf of Mexico program and an expanding international
portfolio, he said. Kerr-McGee and Western Gas Resources strengthen Anadarkos position on all
three counts, with captured growth projects that are consistent with our core skill sets. The
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transactions enable us to create a more focused operating strategy with a larger and lower-risk asset
base.
Hackett said Anadarko will conduct a thorough review of the consolidated assets to select
divestiture candidates, with the dual goals of paring acquisition-related debt and refocusing the
portfolio.
All three companies have certain assets that we will likely deem to be non-core once
combined, he said. Even with divestitures that we believe could generate substantial after-tax
proceeds, we expect the proposed acquisitions to be accretive to both earnings and cash flow on a pro
forma basis.
Anadarko will finance the acquisitions through a $24 billion, 364-day committed acquisition
facility provided by UBS, Credit Suisse and Citigroup. Anadarko plans to use proceeds from asset
sales, free cash flow from operations and the issuance of equity to reduce debt over the next 18 to 24
months.
Given our outlook for energy markets, these transactions make a lot of sense for Anadarko
shareholders. We expect to hedge up to 75 percent of the acquired production through late 2008
using a series of three-way collars, with floors designed to ensure a return on our investment and
ceilings that allow considerable upside, Hackett said. We also expect cost reductions as we
consolidate certain administrative functions, but the biggest synergies are expected to come from
combining the complementary assets of the three companies and the skills of their employees. In
todays tight labor markets, gaining qualified people is a bigger focus than achieving cost savings
through consolidation.
Anadarko is offering Kerr-McGee and Westerns shareholders significant premiums over the
companies recent current stock prices, but looking backward 30 days results in premiums that are
more comparable to precedent transactions. In any case, we believe we are capturing a substantial
disconnect between current property valuations and equity market valuations, and gaining some
exceptional properties and talent in the process, Hackett said. The day-one metrics on proved
reserves and daily production are in-line with other recent transactions. On a full-cycle basis,
including the acquisition and future development costs, we expect to ultimately recover 3.8 billion
barrels of oil equivalent (BOE) from the acquired properties at less than $12.00 per BOE.
Opportunities to gain access to such large, high-margin resource opportunities at such economic full-
cycle costs are rare, and we are excited about the value we expect to create for Anadarko
shareholders.
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SUMMARY OF THE KERR-MCGEE CORPORATION TRANSACTION

Anadarko has agreed to acquire Kerr-McGee Corporation in an all-cash transaction totaling
$16.4 billion, or $70.50 per Kerr-McGee share, plus the assumption of net debt and other liabilities
estimated at $1.6 billion.
Kerr-McGees year-end 2005 proved reserves (excluding pending Gulf of Mexico shelf
divestitures) totaled 898 million BOE, of which approximately 62 percent is natural gas. Proven
undeveloped reserves represented 30 percent of the total. Production in 2006 is expected to be about
92 million BOE, with natural gas representing approximately 60 percent of the total. Anadarko
expects to ultimately recover more than 3.1 billion BOE on the Kerr-McGee properties, at a full-cycle
cost of approximately $39.2 billion ($12.40 per BOE), including the acquisition cost.
Kerr-McGees core properties are located in the deepwater Gulf of Mexico and onshore in Colorado
and Utah. They include 504 deepwater Gulf of Mexico blocks, encompassing seven operated and three non-
operated producing fields, three operated and five non-operated discoveries in varying stages of
development, and four additional prospects that will be drilled this year. These assets are supported by Kerr-
McGees extensive hub-and-spoke infrastructure, which offers highly cost-effective future development
potential. In Colorado, Kerr-McGee holds 451,000 net acres in the Wattenberg natural gas play, located
largely on the Land Grant, where Anadarko owns the royalty interest. In Utah, Kerr-McGee holds 237,000
net acres in the Uinta basins prolific Greater Natural Buttes gas play.
In addition to its extensive, rapidly growing U.S. portfolio, Kerr-McGee produces oil and is
continuing to develop and explore offshore China, has made discoveries and is pursuing the
development of fields on the North Slope of Alaska and offshore Brazil, and is exploring offshore
Australia, West Africa and the islands of Trinidad and Tobago.
Anadarko expects to assign almost the entire acquisition price to Kerr-McGees oil and
natural gas properties. Separate valuations for Kerr-McGees extensive midstream gathering and
processing assets are not available, since those assets are operated in conjunction with the upstream
properties rather than as a separate business segment.
Refer to the attached schedule for further detail on Kerr-McGees properties.
Anadarkos and Kerr-McGees boards of directors have unanimously approved the terms of
the agreement, and Kerr-McGees board has recommended that its shareholders approve the
transaction. The agreement includes a right to match competing offers and a break-up fee of $493
million to be paid under certain circumstances. The transaction, subject to the approval of Kerr-
McGee shareholders as well as other conditions including customary regulatory approvals, is
expected to close by the end of the third quarter.
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For Anadarko, Credit Suisse and UBS acted as financial advisors, Goldman Sachs provided the
fairness opinion and Akin Gump Strauss Hauer & Feld LLP acted as legal counsel.

SUMMARY OF THE WESTERN GAS RESOURCES, INC. TRANSACTION

Anadarko has agreed to acquire Western Gas Resources, Inc. in an all-cash transaction
totaling $4.7 billion, or $61.00 per Western Gas Resources share, plus the assumption of debt and
other liabilities estimated at $600 million.
Western Gas Resources year-end 2005 proven reserves totaled 153 million BOE, with proved
undeveloped reserves representing 57 percent of the total, while 2006 production is expected to total
about 12.5 million BOE. Essentially all of the reserves and production are natural gas. Anadarko
expects to ultimately recover about 705 million BOE on the Western Gas Resources properties, at a
full-cycle E&P cost of approximately $6.7 billion, or less than $10 per BOE, including the
acquisition cost of the oil and gas properties.
Approximately $1.6 billion of the total acquisition price will be allocated to midstream
gathering, processing and transportation assets. Virtually all of the remaining value is assigned to two
natural gas resource plays in Wyoming: coalbed methane (CBM) in the Powder River Basin,
primarily within the Big George coals, and tight gas in the Pinedale field.
Western Gas Resources CBM properties within the Powder River Basin are estimated to hold
about 9 trillion cubic feet (Tcf) of original gas in place and are directly adjacent to Anadarkos assets in
this developing play. Western Gas Resources also has a 10 percent average working interest in their
Pinedale/Jonah joint ventures, which encompass world-class fields totaling more than 40 Tcf of original
estimated gas in place. Anadarko expects that combining its properties with Westerns will accelerate the
development of these natural gas resources and produce strong volume growth through the end of the
decade, and possibly longer, with more than 12,000 identified drilling locations in inventory.
Refer to the attached schedule for further detail on Western Gas Resources properties.
Anadarkos and Western Gas Resources boards of directors have unanimously approved the
terms of the agreement, and Westerns board has recommended that its shareholders approve the
transaction. The agreement includes a right to match competing offers and a break-up fee of $154
million to be paid under certain circumstances. Holders of 17 percent of Westerns outstanding
common shares have agreed to vote in favor of the transaction. Subject to the approval of Western
Gas Resources shareholders as well as other conditions including customary regulatory approvals,
the transaction is expected to close by the end of the third quarter.
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For Anadarko, Credit Suisse and UBS acted as financial advisors, Goldman Sachs provided the
fairness opinion and Akin Gump Strauss Hauer & Feld LLP acted as legal counsel.
This news release contains forward-looking statements within the meaning of Section 27A of the Securities Act of
1933 and Section 21E of the Securities Exchange Act of 1934. Anadarko believes that its expectations are based on
reasonable assumptions. No assurance, however, can be given that such expectations will prove to have been
correct or that the transactions described above will occur. A number of factors could cause actual results to differ
materially from the projections, anticipated results or other expectations expressed in this news release. See Risk
Factors in the companys 2005 Annual Report on Form 10-K and other public filings, press releases and
discussions with company management. Anadarko undertakes no obligation to publicly update or revise any
forward-looking statements.

# # #

ANALYST CONFERENCE CALL TODAY AT 8:30 A.M. CDT, 9:30 A.M. EDT
Anadarko will host an analyst conference call today, Friday, June 23, 2006 at 8:30 a.m. Central
Daylight Time (9:30 a.m. Eastern Daylight Time) to discuss the transactions. The dial-in number is
913-981-4900, and the confirmation number is 1843925. For complete instructions on how to
actively participate in the conference call, or to listen to the live audio webcast or a replay, please
refer to www.anadarko.com.

MEDIA CONFERENCE CALL TODAY AT 10:30 A.M. CDT, 11:30 A.M. EDT
Anadarko will host a media conference call today, Friday, June 23, 2006 at 10:30 a.m. Central
Daylight Time (11:30 a.m. Eastern Daylight Time) to discuss the transactions. The dial-in number is
913-981-5591, and the confirmation number is 7678745. This call is for professional working
journalists only. Participants will be required to register prior to joining the call.

ABOUT ANADARKO
Anadarko Petroleum Corporations mission is to deliver a competitive and sustainable rate of return to
shareholders by exploring for, acquiring and developing oil and natural gas resources vital to the worlds
health and welfare. As of year-end 2005, the company had 2.45 billion barrels-equivalent of proved
reserves, making it one of the world's largest independent exploration and production companies.
Anadarkos operational focus in North America extends from the deepwater Gulf of Mexico, up through
the western U.S. and Canadian regions and onto the North Slope of Alaska. Anadarkos international
activities are focused on major positions in North Africa, the Middle East and Indonesia, as well as
exploration or production operations in several other countries. For more information about how
Anadarko is bringing excellence to the surface, please visit: www.anadarko.com.
ANADARKO CONTACTS
MEDIA:
Teresa Wong, teresa_wong@anadarko.com, (832) 636-1203
Susan Richardson, susan_richardson@anadarko.com, (832) 636-1537

INVESTORS:
David Larson, david_larson@anadarko.com, (832) 636-3265
Stewart Lawrence, stewart_lawrence@anadarko.com, (832) 636-3326
 Anadarko Petroleum Corporation
Transaction Details - Kerr-McGee Corporation (NYSE: KMG)

Purchase Price
Equity value @ $70.50 / share $ 16.4 Billion
Assumption of debt and other liabilities* $ 1.6
Total $ 18.0 Billion

Purchase Price Allocation

Proven reserves $ 11.0 Billion
Unproven / leasehold $ 7.0
Midstream $ -
Total $ 18.0 Billion
Deferred Tax Step-Up $ 4.5 Billion

Resource Potential
Proven reserves @ YE 2005 898 MM Boe 62% Gas
Probables, possibles 2,245 MM Boe 70% Gas

Future Development Capital

Associated with proven reserves $ 3.5 Billion
Associated with probables, possibles $ 17.4
Total $ 21.0 Billion

YE 05** Est YE 06 1Q2006

Net Proven Net Net
Acreage Reserves Probables Production
Asset Details (M Acres) (MM Boe) (MM Boe) (M Boe/d)
Gulf of Mexico (deepwater) 1,667 269 173 87
Uinta Basin, Utah (Natural Buttes tight gas) 237 153 945 30
DJ Basin, Colorado (Wattenberg tight gas) 451 234 240 39
Other Rockies 620 45 21 14
Southern Region 1,400 153 125 54
International (includes Alaska) 14,062 44 293 16
Total 18,437 898 1,797 239

Headquarters Location Oklahoma City

Number of Employees 1,755

* Net of working capital and expected proceeds for assets held for sale
** Excludes GOM Shelf
 Anadarko Petroleum Corporation
Transaction Details - Western Gas Resources, Inc. (NYSE: WGR)

Purchase Price
Equity value @ $61.00 / share $ 4.7 Billion
Assumption of debt and other liabilities $ 0.6
Total $ 5.3 Billion

Purchase Price Allocation

Proven reserves $ 1.7 Billion
Unproven / leasehold $ 2.0
Midstream $ 1.6
Total $ 5.3 Billion
Deferred Tax Step-Up $ 1.3 Billion

Resource Potential
Proven reserves @ YE 2005 153 MM Boe 99% Gas
Probables, possibles 552 MM Boe 99% Gas

Future Development Capital

Associated with proven reserves $ 0.6 Billion
Associated with probables, possibles $ 2.4
Total $ 3.0 Billion

NSAI YE 05 Est YE 06 1Q 2006 2005

Net Proven Net Net Midstream
Acreage Reserves Probables Production Throughput
Asset Details (M Acres) (MM Boe) (MM Boe) (MMcfe/d) (MMcf/d)
Powder River Basin, Wy (coalbed methane) 565 57 336 125 433
Green River Basin, Wy (Pinedale tight gas) 24 88 162 45 443
Other 1,138 9 0 18 544
Total 1,727 153 498 188 1,420

Headquarters Location Denver

Number of Employees 800